New York State Regulators Approve New Power Rate Structure for Crypto Miners

13 07 2018 / 15:09

As reported by Bloomberg on July 12, the new regulations introduce a new electricity rate scheme for mining farm owners

New regulations regarding crypto mining have come to action in the New York state. As reported by Bloomberg on July 12, the new regulations introduce a new electricity rate scheme for mining farm owners; this will allow them to put contracts together in accordance with authorities. Earlier this year, the state of New York also permitted 36 power authorities of the cities to put higher charges on crypto mining compared to regular electricity consumers.

Now, the municipal utility in Massena introduces a new rate structure with aim to additionally charge crypto miners in the area over other residents that do not have mines in their houses. The utility will use contracts that will put additional charge only on the houses with crypto mines to make sure other residents of the area are intact.

John Rhodes, the chair of the New York State Department of Public Service, is sure that this move has fair foundation. Rhodes said in the statement that customers must pay fair price for the amount of electricity they consume. The chair is convinced that new charges and scheme would empower economic development of the region and will help improve the systems to meet the needs of all residents in the area.

New York is known for relatively cheap electricity in the US. This is due to number of hydroelectric plants there. Specifically, Massena residents pay three times fewer charges for consuming power than average citizen of the United States. That’s why the state has become a hot spot for cryptocurrency miners, since their specifically developed machines, or the ‘mining farms’, are highly demanding for electricity.

Other regions with many hydroelectric power plants coped to inhibit mining activities by either increasing prices for electricity or employing regulatory restrictions. In March, the city of Plattsburgh, New York, introduced a temporary ban on mining after this activity had started consuming up to 10% of the energy produced in the region, according to some reports.

In northern Canada, the utility Hydro-Quebec submitted a new regulation according to which mining organizations would need to describe their operations, number of created jobs and fund sources to get the right to consume the local power. The utility wants to increase power capabilities to support the approved blockchain companies, introducing 20% higher prices for them.